SOUTH NYACK – Nyack College announced Wednesday plans to consolidate its South Nyack campus operation into its New York City campus, aiming to reduce its operation costs.
The move comes as the college faces growing debt. The religious and academic institution recently took out a $38.5 million loan against its South Nyack campus from 100 Mile Fund LLC owned by Procida Funding & Advisors, a non-bank lender, according to property records filed with the Rockland County Clerk’s Office.
“We provided them a loan for debt consolidation and working capital,” said Billy Procida, president of Procida Funding. “They had a bunch of loans that we paid off, and we provided them a credit line for operation.”
The Christian college’s financial statement as of June 2017 also shows that the organization had multiple loans totaling more than $70 million. The loans’ annual interest payment, for the year ended June 2017, was $3.87 million, according to the statement.
Maintaining the Manhattan campus at 2 Washington St. in the city’s Financial District has also been expensive.
Since 2013, the college had leased 166,385 square feet of space in a Manhattan office condominium to operate its New York City campus. The college paid annual rent of $3 million for the year ended June 2016 and $4.16 million for the year ended June 2015, according to the financial statement.
In 2016, the college acted on a purchase option in the lease and paid $49.2 million for the eight floors of leased space, including the lower and ground levels as well as the top six floors of the 21-story building, according to Commercial Observer.
To finance the purchase, the college took out a $55 million loan in 2016 and used the remaining funds to pay for closing costs and the cost of furniture and equipment previously bought for the New York City campus, according to the financial statement.
The monthly payment for the $55 million, 10-year loan was $240,631 for the first two years and has increased to $300,314 since May.
Rockland properties’ future
Nyack College has been a major landlord for the past century.
In addition to the 100-plus acre South Nyack campus, the organization owns the 21.7-acre Alliance Theological Seminary site off Route 9W in Upper Nyack. There are also plans to move the college-affiliated seminary to New York City.
What will become of the properties? Local municipalities should work with Nyack College and other educational institutions to strategize the future of the college properties, said Paul Adler, chief strategy officer of Rand Commercial.
“A place like Nyack College is what we call ‘pre-existing non-conforming use.’ It was there before the zoning,” Adler said. “Now the community has to do some outreach to other colleges and other institutions of higher learning. Or, is there a completely different direction that the village would want to take in terms of seeing how that property is being developed?”
“They have to deal with all of the (implications) in zoning and planning,” Adler added.
Most of Nyack College’s parcels are currently tax-exempt, although the college paid special use charges, such as sewer.
“So it (the college’s departure) does not immediately negatively affect the town’s tax base,” said Orangetown Assessor Brian Kenney. “However, if this were sold off, it could benefit the town, school, village and county if the use were to change with new owners that are not eligible for tax exemption.”